Tuesday, December 17, 2013
- Japan November exports (Y/Y): +18.4% versus +17.9% expected and +18.6% previous.
- Japan November imports (Y/Y): +21.1% versus +21.4% expected and 26.1% previous.
- Japan November trade balance (deficit): ¥ -1.29T versus ¥-1.319T expected.
- ETFs: DXJ, EWJ, FXY, YCS, JGBS, JGBD, DFJ, JYN, NKY, DBJP, EZJ, EWV, YCL, SCJ, JSC, JGBL, JPP, ITF, DXJS, JGBT, JPNL, JPNS, FJP
- Russia agrees to lend Ukraine $15B and cut prices for natural gas amid large-scale protests in Kiev over the rejection of a trade deal with the European Union, which has put additional pressure on Ukraine's bonds and currency.
- Gazprom (OGZPY) also will cut gas prices for Ukraine to $268.50 per thousand cubic meters, down from $400.
- Russia had restricted Ukrainian imports in recent months, stepping up pressure on its neighbor as it appeared ready to sign the deal with the EU.
- ETFs: UNG, UGAZ, GAZ, BOIL, DGAZ, UNL, KOLD, NAGS, GASZ, DCNG.
- Toyota (TM +0.2%) aims to raise the average transaction price of its SUV with the new 2014 Highlander.
- The average selling price of the beefed-up model should increase almost 13% to $35K, according to company estimates.
- Execs with Toyota also think the new Highlander will draw in more male buyers after previous versions skewed toward female drivers.
- Thai (THD, TF, TTF) and Indonesian (IDX, EIDO, IDXJ) shares rebound from multi-month lows, rising 0.7% and 1.4%, respectively.
- Also rallying today are Philippine shares (EPHE), up 2% in Manila.
- Southeast Asian investors will be watching the Fed closely for hints about the taper, as many commentators still believe emerging markets will suffer once the FOMC begins to pare its asset purchases.
- The head of Russia's Gazprom (OGZPY) says the long-awaited deal on deliveries to China may not be signed until February despite earlier vows to settle a contract before the end of the year.
- Gazprom signed an agreement with China National Petroleum (PTR) in September on the basic terms for gas supplies but have not yet settled the question of price.
- The two sides have signed initial agreements for the supply of 38B cu. meters of gas/year, the route of delivery, the level of guaranteed volumes CNPC must pay for, and the speed at which supplies will be ramped up.
- While the FOMC members settle in for their two day meeting, U.S. inflation data for November is due out shortly.
- Economists expect that CPI rose 0.1% on month after declining 0.1% in October.
- On year, inflation is seen increasing to 1.3% from 1%, while core inflation is projected to be unchanged at 1.7%.
- European car registrations rose 1.2% Y/Y in November to put together a third consecutive month of gains on the continent.
- By regions, the U.K. and Greece were strong while registrations in Germany slipped 2% during the month.
- Monthly growth by manufacturer: General Motors (GM) -3.8%; Volkswagen (VLKAY) +3.2%; Daimler (DDAIF) -1.6%; BMW (BAMXY) -6.8%; Fiat (FIATY) -5.8%; Renault (RNSDF) +8.9%; Peugeot (PEUGY) -1.2%; Ford (F) -1.8%; Honda (HMC) -4.0%; Hyundai (HYMLF) -7.3%; Toyota (TM) +7.3%; Jaguar Land Rover (TTM) +1.3%; Suzuki (SZKMY) +15.8%; Nissan (NSANY) flat.
- IHS forecasts the global automobile industry will produce 85M sales in 2014, up 3.7% from this year's level.
- Based on the same trend of strong growth in China and the U.S., Deutsche Bank has an even higher estimate for 2014 sales of 87.4M to rep 4% growth.
- Related stocks: GM, F, VLKAY, NSANY, HMC, TM, FIATY, HYMLF, DDAIF, BAMXY.
- Asian shares are mixed, while European equities and U.S. stock futures are flat-to-lower as investors await the outcome of a two-day FOMC meeting today and tomorrow.
- The main question is whether the Fed will decide to start scaling back its bond-buying program. A budget deal in Congress and solid economic data lately suggest that the chances of the taper have gone up.
- "Although we have heavier odds pinned on the tapering being announced in January, we think the economic case has already been made for pulling the trigger," Societe Generale analysts wrote in a note.
- Japan +0.8%, Hong Kong -0.2%, China -0.45%, India -0.2%.
- EU Stoxx 50 -0.6%, London -0.5%, Paris -1%, Frankfurt -0.4%, Milan -0.5%, Madrid -0.4%.
- U.S. stock futures: Dow flat. S&P -0.1%. Nasdaq -0.1%
- The German ZEW survey of investor confidence has climbed to its highest since April 2006 in December, surging to 62 from 54.6 in November and topping consensus of 55.
- The current situation print has increased to 32.4 from 28.7 and exceeded forecasts of 30.
- Sentiment for the eurozone has soared to 68.3 from 60.2 last month.
- "Despite rather disappointing economic data released recently, the financial-market experts expect the economic development in Germany and the eurozone to improve further in 2014," says ZEW President Clemens Fuest.
- The DAX is -0.4%, while the euro is flat at $1.3762. (PR)
- ETFs: EWG, BUND, BUNL, GERJ, BUNT, DBGR, FGM, GGOV, DXGE
- As expected, Eurozone CPI dropped 0.1% on month in November, as it did in October.
- On year, inflation increased 0.9% (also in line) vs +0.7% previously.
- Core CPI +0.9% vs +0.8% in October and consensus of +1%.
- Inflation has edged back up towards the ECB's target of just under 2%, still giving the bank room to further loosen policy if it wants to.
- EU shares are mostly lower ahead of the start of a two-day FOMC meeting today, when the Fed is set to discuss whether to start the dreaded taper.
- The euro is +0.1% at $1.3770. (PR)
- ETFs: FXE, VGK, EUO, FEZ, ERO, EU, EPV, IEV, EZU, DRR, HEDJ, FEU, EUFX, UPV, ULE, FEP, ADRU, URR, FEEU, DBEU, FIEU
- U.K. CPI held steady at +0.1% on month in November, missing consensus for a rise of 0.2%.
- On year, inflation dropped to a four-year low of 2.1% last month from 2.2% in October and vs forecasts that were also 2.2%.
- The drop in annual overall inflation moves the metric closer to the Bank of England's target of 2%.
- "The largest contributions to the fall in the rate came from food and the utilities (gas and electricity)," the government says. "These were partially offset by upward contributions from the transport sector, and from some aspects of recreation and culture."
- Core CPI +1.8% vs +1.7% and +1.8%
- Factory output prices (PPI) fell 0.2% on month vs +0.3% and -0.1%.
- The pound slides vs the dollar but is still +0.1% at $1.6318, while the FTSE 100 is -0.5%. (PR)
- Australia's conservative government has forecast a budget deficit of A$47B (U.S. $42.3B) in the year ending June 30, well above a projection in August by the previous Labor government of A$30.1B.
- Treasurer Joe Hockey said returning to sustainable surpluses would take at least a decade, and would "require a sustained and fundamental structural overhaul of expenditure."
- Hockey left a prediction for GDP growth of 2.5% unchanged, but said unemployment would rise to 6% vs a previous forecast of 6.25% and 5.8% in November.
- The S&P/ASX 200 is +0.3% and the AUD-USD is -1% at $0.8941.
- ETFs: FXA, EWA, AUD, AUSE, CROC, KROO, EWAS, GDAY, FAUS